Economics, diversity, creativity, social justice & BIKES

March 26, 2017March 22, 2017

A Gig Economy that Works

Let’s clear something up immediately, the Gig Economy doesn’t work for individuals. It does work incredibly well for companies that want to cut their labor expenses down to a fraction of what they once were so their executives can make more in their bonuses for all the cost-saving measures they’ve taken.

Whether it’s creating a book cover for $5 on Fiverr, driving a drunken passenger for $11 or picking up food for $6, the labor force working in the Gig Economy, generally, is working itself to death and praying for a decent paying job with benefits and some security.

Could the Gig Economy work? In theory, it’s an awesome idea. It certainly appeals to the imagination that you could make your own hours, work in your pajamas, not have a boss looking over your shoulder. The thing is, for the privilege of working unencumbered, your premium will be working for a far lower wage than an employee at the end of the day.

There are minimum wages for a reason.

So, how could this work? All services come down to differentiation and valuation. What is a service worth to you? (Fast Forward to 3:45). To start, the modern consumer has gotten very accustomed to instant, undivided attention for a very, very, VERY cheap price. The cost for not giving that is firing. If you get three complaints in Uber world, you will be kicked off their system. Same goes for a lot of food app delivery platforms.

The problem with the feedback systems, and Uber has admitted as much publicly, they are stacked against the service provider in favor of kissing up to the customer. There is no arbiter of bad behavior towards the driver. You just get fired. Now every customer could be Leona Helmsley, or Donald Trump (without the billions). They don’t care that you’re hungry because the app hasn’t given you enough jobs to make your rent. They don’t care that while you’re waiting, you’re calculating your bills and how you don’t have the money to cover them.

To start, customers need educating. There need to be more stories and in-depth exposes of the worst aggregators. Back in the day there was this book called the “Green Book.” It was a book created by and used by African Americans so they could travel safely around the country in the Jim Crow era. It listed all the safe places they could go. It would be great if someone would “Yelp” the various Gig Economy aggregators like Angie’s List, Fiverr, the ride hailing services and basically rate them for people that are looking for a Gig. If drivers knew that they’d be giving nearly half their earnings over for taxes, gas and other work related expenses, they might consider driving a school bus or working at a McDonalds instead. Testimonies from burned drivers were enough to keep me from signing up for Grub Hub. They also cemented my decision to quit Skip the Dishes.

Another great thing to do would be “Day in the Life” stories for broadcast on YouTube and other Social Media platforms. If people took customers for an inside peek at their job, kind of like the TV show, “Undercover Boss,” the stories could shed a lot of light on the nefarious practices of these Gig Economy Aggregators. People would start to see them not as Aggregators but for what they really are…Gig Economy Aggravators.

Finally, in San Francisco some bike messengers, disgusted with their companies, since they were classified as independent contractors anyway, quit and started their own companies taking clients with them. Then, when individuals had difficulty with resources, all the Indies pooled their resources. Get together with other drivers, other designers. Yes, it’s a dog-eat-dog world but there are a lot of people on the internet complaining about these Aggregator companies. Aggregate the aggravated masses, talk about bringing abuses to light. Create chat rooms. Blog. Repost articles like this one: http://www.newyorker.com/culture/jia-tolentino/the-gig-economy-celebrates-working-yourself-to-death .

Above all, as a person who’s been in independent contracting positions over the years, lowering your price and lowering the standard of treatment you will accept is not going to get you anywhere but beat up and broke. Not to mention, since you aren’t your own boss, it doesn’t look that great on a resume. So, when you get tired of the Gig Economy, those rare jobs with security, decent pay and benefits will be even harder to get because they’re usually looking for someone who’s been an employee. Gig work isn’t respected like being employed by a well-known non-Aggregator.

It sucks to take your college degree or your vast experience and tuck that and your dreams away for while you work at the pizzeria, flippin’ burgers or stocking shelves, but minimum wage with all the employee protections these days, is not so bad. Plus, while you’re looking for the real deal, or a Gig where you can command what you’re worth, you will meet people and form relationships. It’s practically impossible to do that with customers who have a one-and-done mindset.

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Published by lambchop123

A former bike messenger & Marine, I spent years observing ranges of behaviors and the dance of society. In college I developed a fascination with economics because it gave me another way to understand peoples' motivations. I want people to be able to take charge of their lives and sometimes I hope to reveal things that help make decisions that are important in their lives. View all posts by lambchop123

One thought on “A Gig Economy that Works”

In your race to the bottom/Uber series had a few quick thoughts to add. May be a bit different up here in the Great White North but anyone who can make a successful go of it still has a bunch of other things that affect them:

– No safety nets such as Vacation Pay/Sick Days/Statutory Holiday Pay/Unemployment Insurance/Pensions but you still have to pay a portion of tax to these programs, albeit a much smaller one than an employed person
– Work extra hours doing books, invoicing, sourcing new business, etc that you can’t charge for so therefore doing it for free
– You need to find and hire specialized professionals such as Accountants, Bookkeepers, Mortgage Brokers, Banks, Insures that understand self-employed individuals as your income will always be lower due to how your tax is structured. For example you may actually make $60k/year but your Line Item Income will be about $35k due to the write offs. A LOT of moneylenders don’t understand this and as such they rate you much lower than an employee making the same annual amount

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